New taxes levied
The Finance Bill confirmed many of these changes will come into effect for the next tax year starting in April 2022. Lucy Frazer, the Financial Secretary to the Treasury, welcomed the Bill and what it means for British taxpayers.
She said: “This year’s Finance Bill will help us to continue on our mission to deliver a stronger economy for the British people – through stronger growth, jobs and public finances.”
However, while the Government claims the Bill will help “support a stronger economy for the British people”, additional analysis from CIOT showed it has introduced two new levies for Britons to worry about, taking tax demands to unprecedented levels.
The first new tax introduced was the Residential Property Developer Tax (RPDT). This is a tax on the profits that companies and corporate groups derive from UK residential property development, at four percent on profits exceeding an annual allowance of £25million (to be introduced April 2022); The money raised will fund measures to address unsafe cladding.
Additionally, an Economic Crime (Anti-Money Laundering) Levy which will be paid by firms regulated for anti-money laundering purposes, including accountancy and law firms, financial institutions, estate agents and casinos; the levy will be a fixed amount based on the firm’s size, ranging from £10,000 to £250,000, with firms whose UK revenue is less than £10.2million a year exempt.
It should be noted while these taxes cover worthwhile causes, existing taxes have not been removed, which John Cullinane, Director of Public Policy at CIOT, warned could hamper economic progress as opposed to helping it.
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